Q2 2026 Commerzbank AG Earnings Call

August 6, 2026

Speaker #3: Please note that this call is being transmitted as well as recorded by AudioWebcast, and will subsequently be made available for replay on the internet.

Operator: Please note that this call is being transmitted as well as recorded by audiowebcast and will subsequently be made available for replay on the internet. At this time, all participants have been placed on a listen-only mode. The floor will be open for questions following Bettina Orlopp's and Carsten Schmitt's presentation. Let me now turn the floor over to our CEO, Bettina Orlopp.

Speaker #3: At this time, all participants have been placed on listen-only mode. The floor will be open for questions following Bettina Orlopp’s and Carsten Schmitt’s presentation.

Speaker #3: Let me now turn the floor over to our CEO, Bettina Orlopp.

Speaker #4: Good morning, everyone, and welcome to our earnings call. Carsten and I are pleased to present the results for the first half of a truly remarkable year for Commerzbank.

Bettina Orlopp: Good morning, everyone, and welcome to our earnings call. Carsten and I are pleased to present the results for H1 of a truly remarkable year for Commerzbank. We again achieved record results in an especially demanding environment. This achievement is a credit first and foremost to our clients and our people. The continued partnership and unwavering trust of our clients deserve our sincere appreciation, and the dedication and commitment of our outstanding team, both in Germany and abroad, are the foundation of our success. Our performance demonstrates the fundamental resilience of our business model and the focused execution of our team, even while navigating the complexities of the public takeover discussion at a mixed macroeconomic backdrop. Geopolitical tensions continue to create uncertainty, and the volatility in energy prices with its impact on inflation has added another layer of complexity.

Speaker #4: We again achieved record results in an especially demanding environment. This achievement is a credit, first and foremost, to our clients and our people. The continued partnership and unwavering trust of our clients deserve our sincere appreciation.

Speaker #4: The dedication and commitment of our outstanding team, both in Germany and abroad, are the foundation of our success. Our performance demonstrates the fundamental resilience of our business model and the focused execution of our team.

Speaker #4: Even while navigating the complexities of the public takeover discussion amid a mixed macroeconomic backdrop, geopolitical tensions continue to create uncertainty. The volatility in energy prices and its impact on inflation have added another layer of complexity.

Speaker #4: Let's dive right into the figures that prove the momentum of our financial development. In the first half of 2026, we generated strong revenues of €6.5 billion, a significant increase of 7% year on year.

Bettina Orlopp: Let's dive right into the figures that prove the Momentum of our financial development. In H1 2026, we generated strong revenues of EUR 6.5 billion, a significant increase of 7% year-on-year. Our enhanced operating leverage is evident as our operating result grew by an even stronger 14% to EUR 2.7 billion. This operational strength translates directly into a record net result of EUR 1.8 billion for H1, a 40% increase compared to the previous year, which included restructuring charges for our Momentum strategy. The favorable development is the result of a consistent and successful strategy execution. Our cost discipline remains a cornerstone of this success. The cost-income ratio improved significantly to just 53%, including compulsory contributions. The net return on tangible equity reached an excellent 12.6%, which is a tangible proof of our capital efficient and profitable business model.

Bettina Orlopp: Let's dive right into the figures that prove the momentum of our financial development. In H1 2026, we generated strong revenues of EUR 6.5 billion, a significant increase of 7% year-on-year. Our enhanced operating leverage is evident as our operating result grew by an even stronger 14% to EUR 2.7 billion. This operational strength translates directly into a record net result of EUR 1.8 billion for H1, a 40% increase compared to the previous year, which included restructuring charges for our Momentum strategy. The favorable development is the result of a consistent and successful strategy execution. Our cost discipline remains a cornerstone of this success. The cost-income ratio improved significantly to just 53%, including compulsory contributions. The net return on tangible equity reached an excellent 12.6%, which is a tangible proof of our capital efficient and profitable business model.

Speaker #4: Our enhanced operating level is evident as our operating result grew by an even stronger 14% to €2.7 billion. This operational strength translates directly into a record net result of €1.8 billion for the first six months.

Speaker #4: A 40% increase compared to the previous year, which included restructuring charges for our momentum strategy. The favorable development is the result of consistent and successful strategy execution.

Speaker #4: Our cost discipline remains a cornerstone of this success. The cost-income ratio improved significantly to just 53%, including compulsory contributions. The net return on tangible equity reached an excellent 12.6%, which is tangible proof of our capital-efficient and profitable business model.

Speaker #4: And all this has been built upon a CET1 ratio that remains strong at 14.4%, even after accounting for significant capital distribution. This brings me to our capital return policy, which remains a central pillar of our equity story and a key driver of shareholder value.

Bettina Orlopp: All this is built upon a CET1 ratio that remains strong at 14.4%, even after accounting for significant capital distribution. This brings me to our capital return policy, which remains a central pillar of our equity story and a key driver of shareholder value. Our strategy comes with a full commitment to a total payout of 100% until our CET1 target of 13.5% is reached. For 2026, this translates into a planned capital return of EUR 3.2 billion, representing an attractive total yield of 8%. We are already acting on this commitment. Just last month, we applied for a new share buyback of up to EUR 1.2 billion as a key component of payout for this year. The ECB has already approved our application, and as soon as the German Finance Agency approves as well, we will do the final preparation to actually start the program.

Speaker #4: Our strategy comes with a full commitment to a total payout of 100% until our CET1 target of 13.5% is reached. For 2026, this translates into a planned capital return of €3.2 billion, representing 8%.

Speaker #4: And we are already acting on this commitment. Just last month, we applied for a new share buyback of up to €1.2 billion, as a key component of payout for this year.

Speaker #4: The ECB has already approved our application, and as soon as the German Finance Agency approves as well, we will do the final preparation to actually start the program.

Speaker #4: Alongside the share buyback, we are planning a higher dividend for 2026. We are targeting a dividend share of at least 50% of the total capital return.

Bettina Orlopp: Alongside the share buyback, we are planning a higher dividend for 2026. We are targeting a dividend share of at least 50% of the total capital return. Looking ahead, our path is clear. As our profitability continues to grow, we see a credible trajectory to increasing the total yield to 11% in 2028 and an even more compelling 14% by 2030. This is the financial translation of our Momentum Strategy, a clear and unwavering focus on creating sustainable and attractive shareholder value. Our strong performance is underpinned by a German economy that, despite all headwinds, shows resilience. Due to the slightly improved GDP figures for the last quarters, we lift our expectation from 0.6% to 1% GDP growth for the full year 2026.

Speaker #4: Looking ahead, our path is clear. As our profitability continues to grow, we see a credible trajectory to increasing the total yield to 11% in 2028, and an even more compelling 14% by 2030.

Speaker #4: This is the financial translation of our momentum strategy: a clear and unwavering focus on creating sustainable and attractive shareholder value. Our strong performance is underpinned by a German economy that, despite all headwinds, shows resilience.

Speaker #4: Due to the slightly improved GDP figures for the last quarters, we lift our expectation from 0.6% to 1% GDP growth for the full year 2026.

Speaker #4: While sentiment in the Mittelstand remains cautious, we have seen an improvement in the IFO index and a surprisingly good development of new orders in the second quarter.

Bettina Orlopp: While sentiment in the Mittelstand remains cautious, we have seen an improvement of the Ifo index and a surprisingly good development of new orders in Q2, which could signal a pickup in activity. Furthermore, the latest ECB lending survey indicates an improving demand for credit from corporates, and the German government has launched important reform initiatives for the pension system and the labor market. These initiatives could provide further tailwinds when implemented short-term. This increases our confidence to reach our outlook 2026, which we already raised in May, and includes a targeted return on tangible equity of around 12% and a cost-income ratio of 53%. Our Momentum targets also remain fully in place, providing a clear trajectory for profitable growth and increasing efficiency.

Speaker #4: It could signal a pickup in activity. Furthermore, the latest ECB lending survey indicates an improving demand for credit from corporates, and the German government has launched important reform initiatives for the pension system and the labor market.

Speaker #4: These initiatives could provide further tailwinds when implemented in the short term. This increases our confidence to reach our outlook for 2026, which we already raised in May.

Speaker #4: That includes a targeted return on tangible equity of around 12% and a cost-income ratio of 53%. Our momentum targets also remain fully in place, providing a clear trajectory for profitable growth and increasing efficiency.

Speaker #4: It shows a steady improvement in our net ROTE targets towards 17% in 2028 and 21% in 2030, while our cost-income ratio is planned to improve to 43%.

Bettina Orlopp: It shows a steady improvement in our net RoTE targets towards 70% in 2028 and 21% in 2030, while our cost-income ratio is planned to improve to 43%. This future path is built on a solid track record of successful transformation. At the end of this year, we will have improved our profitability by approximately EUR 3 billion since 2021 and will consistently have exceeded our ambitious financial targets. Market has clearly rewarded this performance, as you can tell from our share price, which rose by more than 600%. This brings me directly to our management priorities. The first and most important one is to execute our strategy with continued discipline. Momentum 2030 is working. It is delivering, and it is the benchmark against which any alternative must be measured. Our focus is on further development of the business model and the consistent delivery of strong financial results.

Speaker #4: This future path is built on a solid track record of successful transformation. By the end of this year, we will have improved our profitability by approximately €3 billion since 2021, and will consistently have exceeded our ambitious financial targets.

Speaker #4: The market has clearly rewarded this performance, as you can tell from our share price, which rose by more than 600%. And this brings me directly to our management priorities.

Speaker #4: The first and most important one is to execute our strategy with continued discipline. Momentum 2030 is working. It is delivering, and it is the benchmark against which any alternative must be measured.

Speaker #4: Our focus is on further development of the business model and the consistent delivery of strong financial results. Second, we will further drive performance. This means leveraging our excellent client franchise and the deep, trustful relationships our teams have built over the years.

Bettina Orlopp: Second, we will further drive performance. This means leveraging our excellent client franchise and the deep, trustful relationships our teams have built over many years. It also means sustaining the high motivation of our employees, who are the bedrock of our success. Third, we will protect value. As management board, we are committed to acting in the best interest of all our stakeholders. This includes constructive strategic discussions with UniCredit. The clear objective is to maximize value and to ensure the long-term success of Commerzbank. A key accelerator of our progress and a central element of our Momentum strategy is artificial intelligence. We are moving the speed and precision from initiative to concrete proof points that realize tangible value.

Speaker #4: It also means sustaining the high motivation of our employees, who are the bedrock of our success. And third, we will protect value. As the Management Board, we are committed to acting in the best interests of all our stakeholders.

Speaker #4: This includes constructive strategic discussions with UniCredit. The clear objective is to maximize value and to ensure the long-term success of Commerzbank. The key accelerator of our progress, and the central element of our momentum strategy, is artificial intelligence.

Speaker #4: We are moving this speed and precision from initiatives to concrete proof points that realize tangible value. To recap, we are targeting cumulative investments in AI of around €600 million through 2030, which are expected to generate a value contribution of approximately €500 million per annum by 2030.

Bettina Orlopp: To recap, we are targeting cumulative investments in AI of around EUR 600 million through 2030, which are expected to generate a value contribution of approximately EUR 500 million per annum by 2030. In Q2, we made significant progress. We have completed the rollout of AI tools like MS Copilot and Google Gemini to all employees and launched a dedicated AI Academy to foster a culture of digital innovation. Our AI-powered agent assist is now available to around 2,800 employees, enhancing the quality and efficiency of client interactions in our remote advisory and call centers. Furthermore, AI is helping us to modernize our IT landscape. In H1 2026 alone, we decommissioned 10% of all IT systems. For us, AI is not a distant vision. It is a core driver of our transformation, delivering tangible results already today.

Speaker #4: In the second quarter, we made significant progress. We have completed the rollout of AI tools like MS Copilot and Google Gemini to all employees, and launched a dedicated AI Academy to foster a culture of digital innovation.

Speaker #4: Our AI-powered agent assist is now available to around 2,800 employees, enhancing the quality and efficiency of client interactions in our remote advisory and call centers.

Speaker #4: Furthermore, AI is helping us to modernize our IT landscape. In the first half of 2026 alone, we decommissioned 10% of all IT systems. For us, AI is not a distant vision.

Speaker #4: It is a core driver of our transformation, delivering tangible results already today. The strong Group performance is driven by the strength of our client business.

Bettina Orlopp: The strong group performance is driven by the strength of our client business. In corporate clients, we have once again proven our position as the clear number one in Germany. The latest finance survey named us the leading Mittelstand bank and the best bank for corporate clients overall. This is testament to our strong, trustful client relationships. Our success is built on deep client orientation and locally established and a globally networked franchise and market-leading products. This is exemplified by our successful expansion of commodity products, which we have started to support our clients with the trading of physical gas. Furthermore, we have expanded our offering for Mittelstand clients who use our direct banking services. Overall, we are the partner of choice for the German Mittelstand, and we are continuously investing to defend and expand this leadership position. Our Private and Small-Business Customers segment also shows an excellent momentum.

Speaker #4: In corporate clients, we have once again proven our position as a clear number one in Germany. The latest finance survey named us the leading Mittelstandsbank and the best bank for corporate clients overall.

Speaker #4: This is testament to our strong, tactful client relationships. Our success is built on deep client orientation, a locally established and globally networked franchise.

Speaker #4: And market-leading products. This is exemplified by our successful expansion of commodity products, with which we have started to support our clients in the trading of physical gas.

Speaker #4: Furthermore, we have expanded our offering for Mittelstand clients who use our direct banking services. Overall, we are the partner of choice for the German Mittelstand, and we are continuously investing to defend and expand this leadership position.

Speaker #4: Our private and small business customer segment also shows excellent momentum. The key driver here is our securities business, which is significantly boosting our fee income.

Bettina Orlopp: The key driver here is our securities business, which is significantly boosting our fee income. We achieved a strong 10% growth in net commission income in PSBC, Germany. This growth is fueled by strong client activity. Discretionary portfolio management volumes grew by an impressive 20% year on year to around EUR 25 billion. The total securities volume held by our clients increased by 16% to EUR 285 billion, and at Comdirect, the number of trades increased by 5%. This success is consistently validated by external recognition. For the ninth consecutive year, we were named the best branch-based bank and with Comdirect, the best direct bank in Germany. This proves that our two-brand strategy is the right approach to serve the needs of our clients. Now, I would like to turn to the takeover offer from UniCredit. The offer period has ended and the result speaks a clear language.

Speaker #4: We achieved a strong 10% growth in net commission income in PSPC Germany. This growth is fueled by strong client activity. Discretionary portfolio management volumes grew by an impressive 20% year-on-year to around €25 billion.

Speaker #4: The total securities volume held by our clients increased by 16% to €285 billion. And at Comdirect, the number of trades increased by 5%.

Speaker #4: This success is consistently validated by external recognition. For the ninth consecutive year, we were named the best branch-based bank and, with Comdirect, the best direct bank in Germany.

Speaker #4: This proves that our two-brand strategy is the right approach to serve the needs of our clients. Now, I would like to turn to the takeover offer from UniCredit.

Speaker #4: The offer period has ended, and the results speak a clear language. UniCredit has reached access to almost 50% of voting rights. Also, the offer was not supported by independent shareholders.

Bettina Orlopp: UniCredit has reached access to almost 50% of voting rights. The offer was not supported by independent shareholders. Only 2.7% of our institutional and retail investors tendered their shares, and a large portion of the shares tendered was most likely borrowed by UniCredit-linked financial institutions. However, we have to navigate the way forward. This requires a professional level of collaboration to develop a common path that reflects the emerging shareholder structure, including technicalities when it comes to legal and financial topics. Hence, we have started talks on this, which is in the genuine interest of both UniCredit and Commerzbank, as we are both determined to create value for our shareholders, clients, and employees. I'm optimistic that step by step we can find common ground on governance and also on the business model. The governance framework is clear.

Speaker #4: Only 2.7% of our institutional and retail investors tendered their shares, and a large portion of the shares tendered was most likely borrowed by UniCredit-linked financial institutions.

Speaker #4: However, we have to navigate the way forward. This requires a professional level of collaboration to develop a common path that reflects the emerging shareholder structure.

Speaker #4: Including technicalities when it comes to legal and financial topics, hence we have started talks on this, which is in the genuine interest of both.

Speaker #4: UniCredit and Commerzbank, as we are both determined to create value for our shareholders, clients, and employees. I'm optimistic that, step by step, we can find common ground on governance and also on the business model.

Speaker #4: The governance framework is clear. Any structural changes, such as the domination agreement, require a qualified majority of at least 75% of the votes at our Annual General Meeting.

Bettina Orlopp: Any structural changes, such as the domination agreement, require a qualified majority of at least 75% of the votes at our annual general meeting. This is key for the realization of major parts of synergies while always considering the rights of minority shareholders. Beyond this, only full ownership via squeeze-out provides a clean path towards exercising full control. The management board and the supervisory board of Commerzbank have a fiduciary duty to all shareholders. We will continue to work in the best interest of all our investors and to protect the rights of our minority shareholders. Our mandate is to ensure that the value generated by Commerzbank benefits all of you. This leads me to the conclusion that besides Momentum 2030, only a joint approach has the potential to create value for all stakeholders. Our Momentum strategy represents a proven, reliable, and highly attractive plan with limited execution risks.

Speaker #4: This is key for the realization of major parts of synergies, while always considering the rights of minority shareholders. Beyond this, only full ownership via squeeze-out provides a clean path towards exercising full control.

Speaker #4: The Management Board and the Supervisory Board of Commerzbank have a fiduciary duty to all shareholders. We will continue to work in the best interest of all our investors and to protect the rights of our minority shareholders.

Speaker #4: Our mandate is to ensure that the value generated by Commerzbank benefits all of you. This leads me to the conclusion that, besides Momentum 2030, only a joint approach has the potential to create value for all stakeholders.

Speaker #4: Our momentum strategy represents a proven, reliable, and highly attractive plan with limited execution risks. It is a tangible roadmap to substantial value creation. In contrast, the Commerzbank unlocked approach presented by UniCredit is, in our firm opinion, based on incomplete outside information and assumptions in terms of value creation, and comes with significant execution risks.

Bettina Orlopp: It is a tangible roadmap to substantial value creation. In contrast, the Commerzbank Unlocked approach presented by UniCredit is, in our firm opinion, based on incomplete outside information and assumptions in terms of value creation and comes with significant execution risks. Moreover, it does not reflect value accretive business, especially when it comes to our international network. Therefore, our position is clear. We are ready for constructive discussions towards a jointly developed solution and realistic value creation assumptions. This will avoid costly misunderstandings of the Commerzbank business model. Let me summarize my key takeaways for you today. First, we achieved a record H1 result and we fully confirm our guidance and targets. We are a bank that delivers. Second, we continue to focus on the disciplined implementation of our Momentum strategy. This is our plan for delivering reliable shareholder value with low execution risk.

Speaker #4: Moreover, it does not reflect value-accretive business, especially when it comes to our international network. Therefore, our position is clear: we are ready for constructive discussions towards a jointly developed solution and realistic value creation assumptions.

Speaker #4: This will avoid costly misunderstandings of the Commerzbank business model. Let me summarize my key takeaways for you today. First, we achieved a record H1 result, and we fully confirm our guidance and targets.

Speaker #4: We are a bank that delivers. Second, we continue to focus on the disciplined implementation of our momentum strategy. This is our plan for delivering reliable shareholder value with low execution risks.

Speaker #4: Third, we are ready to find a constructive solution with UniCredit, and we will always work in the best interest of all stakeholders. Our shareholders continue to benefit from our strong delivery and the strategic optionality that comes with the current situation.

Bettina Orlopp: Third, we are ready to find a constructive solution with UniCredit, and we will always work in the best interest of all stakeholders. Our shareholders continue to benefit from our strong delivery and the strategic optionality that comes with the current situation. With that, I'm happy to hand over to Carsten, who will guide you through the detailed financials.

Speaker #4: And with that, I'm happy to hand over to Carsten, who will guide you through the detailed financials.

Speaker #2: Thank you, Bettina. And a warm welcome also from my side. Bettina has set out the strategic picture. We are performing well, Momentum 2030 is progressing, and we generate attractive shareholder returns.

Carsten Schmitt: Thank you, Bettina, and a warm welcome also from my side. Bettina has set out the strategic picture. We are performing well, Momentum 2030 is progressing, and we generate effective shareholder returns. Since 2021, we have consistently improved our performance and delivered on our commitments. This quarter is another step on that journey. In Q2, we have continued to make progress where it matters. Revenues are up and costs are managed in line with our target cost-income ratio while increasing investments. Continuously improving this positive operating leverage is at the heart of our Momentum 2030 strategy. The risk result continues to be well contained and the capital ratio remains strong. With these positive developments, we have achieved our best ever quarterly operating result of EUR 1,367 million. We are delivering these results in a less supportive interest rate environment, especially in Poland, and facing ongoing geopolitical headwinds.

Speaker #2: Since 2021, we have consistently improved our performance and delivered on our commitments. This quarter is another step on that journey. In Q2, we have continued to make progress where it matters.

Speaker #2: Revenues are up, and costs are managed in line with our target cost-income ratio, while increasing investments. Continuously improving this positive operating leverage is at the heart of our Momentum 2030 strategy.

Speaker #2: The risk result continues to be well contained, and the capital ratio remains strong. With these positive developments, we have achieved our best ever quarterly operating result of €1.367 billion.

Speaker #2: We are delivering these results in a less supportive interest rate environment, especially in Poland, and facing ongoing geopolitical headwinds. This demonstrates the strength of our franchise, the resilience of our business model, and the progress we are making in executing our strategy.

Carsten Schmitt: This demonstrates the strength of our franchise, the resilience of our business model, and the progress we are making in executing our strategy. With a net RoTE of 12.5% in the quarter, we are firmly on course to reach our 12% target for the year. I will now go through the line items in more detail, starting with revenues. Revenues are up 9% year-on-year, the uplift is broad based. Net commission income has again grown by 7% compared to last year. The strongest contribution came from PSBC Germany. The net interest income of EUR 2,059 million is up slightly compared to Q1 and basically stable compared to last year. This is in line with our expectations, we anticipate a pickup in the H2. In contrast, the fair value result is up EUR 92 million year-on-year and EUR 21 million compared with Q1.

Speaker #2: With a net royalty of 12.5% in the quarter, we are firmly on course to reach our 12% target for the year. I will now go through the line items in more detail, starting with revenues.

Speaker #2: Revenues are up 9% year on year, and the uplift is broad-based. Net commission income has again grown by 7% compared to last year. The strongest contribution came from PSBC Germany.

Speaker #2: The net interest income of €2 billion and €59 million is up slightly compared to Q1, and basically stable compared to last year. This is in line with our expectations, and we anticipate a pickup in the second half.

Speaker #2: In contrast, the fair value result is up €92 million year on year, and €21 million compared with Q1. This mainly reflects the impact of lower interest rates, particularly in Poland and, to a lesser extent, in the eurozone.

Carsten Schmitt: This mainly reflects the impact of lower interest rates, particularly in Poland and to a lesser extent in the Eurozone. Other income excluding mBank's FX loan provisions was also higher. The EUR 19 million year-on-year increase mainly reflects tax-related effects and realization gains. The quarter-on-quarter improvement was additionally driven by the non-recurring hedge results and the seasonally higher dividends from participations. The next two slides cover the fee income. Net commission income is up 7% year-on-year, supported by all customer segments, underlining the quality of our revenue growth. The very healthy 6% increase in corporate clients was driven by cash management, trade finance, and capital markets. Bond market activity remained particularly strong and continued the momentum we saw in Q1. Net commission income growth in PSBC Germany was an excellent 11% year-on-year. The securities business was the main driver. This includes both advisory business at Commerzbank and transaction-based business at Comdirect.

Speaker #2: Other income excluding mBank's FX loan provisions was also higher. The €19 million year-on-year increase mainly reflects tax-related effects and realization gains. The quarter-on-quarter improvement was additionally driven by the non-recurring hedge result and the seasonally higher dividends from participations.

Speaker #2: The next two slides cover the fee income. Net commission income is up 7% year-on-year, supported by all customer segments, underlining the quality of our revenue growth.

Speaker #2: The very healthy 6% increase in corporate clients was driven by cash management, trade finance, and capital markets. Bond market activity remained particularly strong and continued the momentum we saw in Q1.

Speaker #2: Net commission income growth in PSBC Germany was an excellent 11% year-on-year. The securities business was the main driver. This includes both the advisory business at Commerzbank and the transaction-based business at Comdirect.

Speaker #2: Payments also developed well, supported by the account fee increases introduced last year. We expect the contribution from this source to normalize over the coming quarters.

Carsten Schmitt: Payments also developed well, supported by the account fee increases introduced last year. We expect the contribution from this source to normalize over the coming quarters. Overall, the growth demonstrates the strength of our franchise across all customer groups. I will now move to interest income on slide 19. The net interest income reflects two opposing effects, business growth and lower central bank rates. Net, they have largely balanced out this quarter. Looking at the segments in corporate clients, higher loan and deposit volumes resulted in a healthy increase of the net interest income of 7% year-on-year. In private and small business customers Germany, NII grew by 10% year-on-year based on the ongoing improvement of the profitability of deposits. At mBank, the picture is different. Lower policy rates in Poland more than offset higher volumes. As a result, net interest income declined.

Speaker #2: Overall, the growth demonstrates the strength of our franchise across all customer groups. I will now move to interest income on slide 19. The net interest income reflects two opposing effects.

Speaker #2: Business growth and lower central bank rates have largely balanced out this quarter. Looking at the segments, in Corporate Clients, higher loan and deposit volumes resulted in a healthy increase of the net interest income of 7% year on year.

Speaker #2: In Private and Small Business Customers Germany, NRI grew by 10% year on year, based on the ongoing improvement of the profitability of deposits. At mBank, the picture is different.

Speaker #2: Lower policy rates in Poland more than offset higher volumes. As a result, net interest income declined. However, this was compensated by a better fair value result from rates hedging activities.

Carsten Schmitt: However, this was compensated by a better fair value result from rates hedging activities. Adding the two line items together, this results in EUR 9 million higher rates-related revenues at mBank year-on-year. The story is similar in others in consolidation, where year-on-year lower net interest income is partially offset in the fair value result. On the next two slides, I will go through the volume development. Quarter-on-quarter deposits were overall stable in PSBC Germany and corporate clients. Corporate clients have attracted EUR 2 billion additional sight deposits, while PSBC Germany has seen a decline in core deposits by EUR 2 billion. Competition for core deposits remains very intense in Germany. We therefore saw some outflows of highly rate-sensitive deposits to competitors offering teaser rates above 3%. We stayed disciplined and continued to prioritize profitability.

Speaker #2: Adding the two line items together, this results in €9 million higher rates-related revenues at mBank year on year. The story is similar in others in consolidation, where year on year, lower net interest income is partially offset in the fair value result.

Speaker #2: On the next two slides, I will go through the volume development. Quarter-on-quarter, deposits were overall stable in PSBC Germany and Corporate Clients. Corporate Clients have attracted €2 billion in additional side deposits, while PSBC Germany has seen a decline in call money by €2 billion.

Speaker #2: Competition for call deposits remains very intense in Germany. We therefore saw some outflows of highly rate-sensitive deposits to competitors offering teaser rates above 3%.

Speaker #2: We stayed disciplined and continued to prioritize profitability. In the loan business, PSBC Germany had stable volumes, while corporate clients have sustained its very substantial volume expansion, keeping it well ahead of target.

Carsten Schmitt: In the loan business, PSBC Germany had stable volumes while corporate clients have sustained its very substantial volume expansion, keeping it well ahead of target. More details will follow on slide 21. In the last 12 months, corporate clients achieved a remarkable average loan growth of EUR 17 billion or 16%, thereof EUR 8 billion in the H1 of 2026. This level of loan growth reflects the strength of our franchise and the trust our clients place in us. Demand from our clients remains largely international. Encouragingly, we have recently seen relatively more activity within Europe. We are also seeing the first signs of a recovery in Germany, albeit coming from a low level. With institutionals, we have increased revenues throughout the last 12 months despite a lower growth in trade finance. Overall, we are encouraged by the trajectory of the loan business.

Speaker #2: More details will follow on slide 21. In the last 12 months, corporate clients achieved a remarkable average loan growth of €17 billion, or 16%—of which €8 billion was in the first half of 2026.

Speaker #2: This level of loan growth reflects the strength of our franchise and the trust our clients place in us. Demand from our clients remains largely international.

Speaker #2: Encouragingly, we have recently seen relatively more activity within Europe. We are also seeing the first signs of a recovery in Germany, albeit coming from a low level.

Speaker #2: With institutionals, we have increased revenues throughout the last 12 months, despite slower growth in trade finance. Overall, we are encouraged by the trajectory of the loan business.

Speaker #2: Our expectation is that the slight trend of more European demand can be maintained, and we are cautiously optimistic for a pickup in Germany. This brings me to our NRI outlook for 2026.

Carsten Schmitt: Our expectation is that the slight trend of more European demand can be maintained and are cautiously optimistic for a pickup in Germany. This brings me to our NII outlook for 2026. We confirm our outlook for NII of around EUR 8.6 billion. So far, we have only seen a slight increase in H1 compared to H2 of last year. In the H2, we expect a noticeable pickup. Rates in Poland, which were a drag in the H1, should stabilize and the NII increase in mBank. The contributions from the replication portfolio will increase with further rollovers. The expected higher ECB rates will be beneficial and we anticipate further volume growth. With all these drivers moving in the same direction, we are confident that the net interest income will increase over the coming quarters and reach around EUR 8.6 billion for the full year.

Speaker #2: We confirm our outlook for NRI of around €8.6 billion. So far, we have only seen a slight increase in H1 compared to H2 of last year.

Speaker #2: In the second half, we expect a noticeable pickup. Rates in Poland, which were a drag in the first half, should stabilize, and the NRI increase in mBank.

Speaker #2: The contributions from the replication portfolio will increase with further rollovers. The expected higher ECB rates will be beneficial, and we anticipate further volume growth.

Speaker #2: With all these drivers moving in the same direction, we are confident that net interest income will increase over the coming quarters and reach around €8.6 billion for the full year.

Speaker #2: As discussed previously, the replication portfolio provides a significant structural tailwind and will add €400 to €600 million NRI every year until 2030. Updated projections are included in the appendix.

Carsten Schmitt: As discussed previously, the replication portfolio provides a significant structural tailwind and will add EUR 400 to 600 million NII every year until 2030. Updated projections are included in the appendix. Now to costs on slide 23. Group costs are fully aligned with our Momentum 2030 targets. We continue with significant investments where it matters while keeping a firm grip on efficiency. In the group, excluding mBank, we increased IT investments by 12% and further expanded our shoring and sourcing activities. We have added staff in a few key areas while also absorbing salary increases and costs related to our employee share program. Despite these investments, costs in the group excluding mBank remained flat. The increases were offset by active cost management, lower burdens from equity-based compensation, and the non-recurrence of a one-off from last year.

Speaker #2: And now to costs on Slide 23. Group costs are fully aligned with our momentum and 2030 targets. We continue with significant investments where it matters, while keeping a firm grip on efficiency.

Speaker #2: In the group, excluding mBank, we increased IT investments by 12% and further expanded our shoring and sourcing activities. We have added staff in a few key areas, while also absorbing salary increases and costs related to our employee share program.

Speaker #2: Despite these investments, costs in the group excluding mBank remained flat. The increases were offset by active cost management, lower burdens from equity-based compensation, and the non-recurrence of a one-off from last year.

Speaker #2: mBank has continued investing in its business but also had to absorb higher compulsory contributions. Overall, we are well on our way to reach our target of a cost-income ratio of 53% this year, or 51% excluding compulsory contributions, an improvement of 4 percentage points from last year.

Carsten Schmitt: mBank has continued investing in its business but also had to absorb higher compulsory contributions. Overall, we are well on our way to reach our target of a cost-income ratio of 53% this year, or 51% excluding compulsory contributions, an improvement of 4 percentage points from last year. The risk result came in at EUR 202 million. This is fully in line with our expectations and outlook. Default rates in Germany are edging up slightly. However, most of the increase relates to small service sector companies where our exposure is limited. When looking at the default rates in the German Mittelstand, trends are broadly stable with only a very moderate uptick. The portfolio remains highly resilient with an unchanged non-performing exposure ratio of only 1.1%. We have maintained our approach to overlays and there has been no material change in the outstanding amounts.

Speaker #2: The risk result came in at €202 million. This is fully in line with our expectations and outlook. Default rates in Germany are edging up slightly.

Speaker #2: However, most of the increase relates to small service sector companies, where our exposure is limited. When looking at the default rates in the German Mittelstand, trends are broadly stable, with only a very moderate uptick.

Speaker #2: The portfolio remains highly resilient, with an unchanged non-performing exposure ratio of only 1.1%. We have maintained our approach to overlays, and there has been no material change in the outstanding amounts.

Speaker #2: Year to date, the increase of the risk result was only around €44 million. However, given the ongoing geopolitical uncertainties, including the conflict in the Middle East, we maintain our full-year guidance of a risk result of around €850 million.

Carsten Schmitt: Year-to-date, the increase of the risk result was only around EUR 44 million. However, given the ongoing geopolitical uncertainties, including the conflict in the Middle East, we maintain our full-year guidance of a risk result of around EUR 850 million. This concludes the view on the key line items. Slide 25 summarizes the drivers of the EUR 898 million net results. The tax rate was 28% in the quarter. For the full year, we expect a tax rate close to 30%, mainly driven by a higher corporate tax rate in Poland. As I've covered the main developments in the segments already, I will now jump straight to slide 30 and the development of RWA and capital. In Q2, we have around EUR 3 billion higher RWA quarter-on-quarter due to the expanding loan business in mBank and the assets in the liquidity portfolio of treasury in others and consolidation.

Speaker #2: This concludes the review of the key line items. Slide 25 summarizes the drivers of the €898 million net result. The tax rate was 28% in the quarter.

Speaker #2: For the full year, we expect a tax rate close to 30%, mainly driven by a higher corporate tax rate in Poland. As I've covered the main points...

Speaker #2: In the segments already, I will now jump straight to slide 30 and the development of RWA and capital. In Q2, we have around €3 billion higher RWA quarter-on-quarter due to the expanding loan business in mBank and the assets in the liquidity portfolio of Treasury in Others and consolidation.

Speaker #2: RWA from higher volumes in corporate clients were more than offset by a new SRT. Capital is slightly higher, as the OCI increased. In line with our capital return policy and commitment of a 100% payout ratio, we have reserved the full net result after AT1 coupon payments, amounting to €1.7 billion for distribution.

Carsten Schmitt: RWA from higher volumes in corporate clients were more than offset by a new SRT. Capital is slightly higher as the OCI increased. In line with our capital return policy and commitment of a 100% payout ratio, we have reserved the full net result after AT1 coupon payments amounting to EUR 1.7 billion for distribution. Thereof, part will be utilized for the share buyback of up to EUR 1.2 billion that has already been approved by the ECB. The CET1 ratio is therefore at 14.4%. In Q2, we have applied for an adjustment of the scope of our internal credit risk models. We expect ECB approval in Q3. Once implemented, the change should lead to a significant reduction in RWA. Based on our current calculations, the impact should be in the mid to high single-digit billion range and gradually materialize by the end of Q2 2027.

Speaker #2: Part of this will be utilized for the share buyback of up to €1.2 billion that has already been approved by the ECB. The CET1 ratio is, therefore, at 14.4%.

Speaker #2: In Q2, we have applied for an adjustment of the scope of our internal credit risk models. We expect ECB approval in Q3. Once implemented, the change should lead to a significant reduction in RWA.

Speaker #2: Based on our current calculations, the impact should be in the mid to high single-digit billion range and is expected to gradually materialize by the end of Q2 2027.

Speaker #2: This will further strengthen our capital growth. Depending on the timing and final approval, this may reduce the volume of SRTs we issue this year.

Carsten Schmitt: This will further strengthen our capital position and support profitable growth. Depending on the timing and final approval, this may reduce the volume of SRTs we issue this year. Now to the outlook. We are firmly on track for another record year and confirm our unchanged outlook for the year. We expect total revenues of approximately EUR 13.2 billion based on strong NII and NCI growth. We maintain our outlook for the risk result of around EUR 850 million. Based on costs of around EUR 7 billion, we target a cost-income ratio of approximately 53%. We confirm our net result target of at least EUR 3.4 billion, leading to a net return on tangible equity of around 12%. We confirm our plan for a payout ratio of 100% after AT1 coupon payments and expect our CET1 ratio to be above 14% at year-end.

Speaker #2: And now to the outlook. We are firmly on track for another record year and confirm our unchanged outlook for the year. We expect total revenues of approximately €13.2 billion, based on strong NRI and NCI growth.

Speaker #2: We maintain our outlook for the risk result of around €850 million. Based on costs of around €7 billion, we target a cost-income ratio of approximately 53%.

Speaker #2: We confirm our net result target of at least €3.4 billion, leading to a net return on tangible equity of around 12%. And we confirm our plan for a payout ratio of 100% after 81 coupon payments, and expect our CET1 ratio to be above 14% at year-end.

Speaker #2: To summarize, the unchanged outlook and the record result clearly confirm our financial strength and potential. We will continue to deliver. And with that, I conclude the presentation.

Carsten Schmitt: To summarize, the unchanged outlook and the record result clearly confirm our financial strength and potential. We will continue to deliver. With that, I conclude the presentation. Thank you for your attention, and Bettina and I are now happy and looking forward to answer your questions.

Speaker #2: Thank you for your attention, and Bettina and I are now happy and looking forward to answering your questions.

Speaker #1: Thank you very much. Ladies and gentlemen, if you would like to ask a question, please press star 9 followed by the hash key on your phone.

Operator: Thank you very much. Ladies and gentlemen, if you would like to ask a question, please press star nine followed by the hash key on your phone. You will receive confirmation that your question has been registered. If you wish to withdraw your question, please press star three followed by the hash key. Please note that the option to submit questions is available only if you have dialed in by phone. It is not possible to submit a question if you are participating via the web interface. The first question comes from Tarik El Mejjad from Bank of America.

Speaker #1: You will receive confirmation that your question has been registered. If you wish to withdraw your question, please press star 3, followed by the hash key.

Speaker #1: Please note that the option to submit questions is available only if you have dialed in by phone. It is not possible to submit a question if you are participating via the web interface.

Speaker #1: The first question comes from Tarek El-Majad from Bank of America.

Speaker #3: Hi, good morning, and thanks for taking my questions. I have two pieces. First, on the deal with UnionCredit, clearly there's a charging zone here in regards to your credit, which is good to see.

Tarik El Mejjad: Hi, good morning and thanks for taking my questions. I have two, please. First on the deal with UniCredit. Clearly, there's a change in tone here in regards to UniCredit, and it's good to see it could remove that deadlock. Your red lines were the valuation and strategy of Commerzbank Unlocked, especially on the international markets, the deleveraging. What will these talks will include that you'll have post Q2, and how far are you ready to compromise on the strategy on that specific point? Also, in Q2 result for UniCredit, CEO mentioned that some of the restructuring costs, EUR 2, 3 billion will be booked in Commerzbank accounts possibly as soon as 2027. Is that something that you can have a say or a choice on that? Should we start to adjust our numbers on that regards?

Speaker #3: It's good to remove that deadlock—deadlock, sorry. Your redlines were the valuation and strategy of Commerzbank unlocked, especially on the international markets. The delivering.

Speaker #3: So what will these stocks include that you'll have post-Q2? And how far are you ready to compromise on the strategy on that specific point?

Speaker #3: And also, in the Q2 results for your credit, I see you mentioned that some of the restructuring costs—up to €3 billion—will be booked in Commerzbank accounts, possibly as soon as 2027.

Speaker #3: Is that something that you can have a say in, or a choice on? And should we start to adjust our numbers in that regard?

Speaker #3: And the second question is on the mix of cash and share buyback. You announced up to €1.2 billion. Should we expect another tranche of buyback, or will the remainder mostly be in the form of a dividend?

Tarik El Mejjad: Second question is on the mix of cash and share buyback. You announced up to EUR 1.2 billion. Should we expect another tranche of buyback or the remainder will be mostly in the form of dividend? Thank you.

Speaker #3: Thank you.

Bettina Orlopp: Thank you, Tarik. Indeed, what we now need to do is to sit down and develop a joint solution. I think it starts with exchanging views on what we see, what the strengths are. We also have some technical details to clarify, but we also need to work out how we collaborate in the current situation with UniCredit having a little bit less than 50%. I think still we should identify areas where we can already create value in a joint approach. Then probably we also should think a little bit about a target picture midterm. I think we should start the dialogue and then we will come back whenever we have a solution. I think that is a better way than the other way around, being now very transparent on what we wish or not wish.

Speaker #4: Dear Tarek, yeah, I mean, indeed, what we now need to do is sit down and develop a joint solution. And I think it starts with exchanging views on what we see, what the strengths are.

Speaker #4: We also have some technical details to clarify, but we also need to work out how we collaborate in the current situation, with UnionCredit having a little bit less than 50%.

Speaker #4: But I think we should still identify areas where we can already create value through a joint approach. And then, probably, we should also think a little bit about a midterm target picture.

Speaker #4: And I mean, I think we should start the dialogue, and then we will come back whenever we have a solution. I think that is a better way than the other way around—being now very transparent on what we wish or do not wish.

Speaker #4: When it comes to restructuring costs and what has been said by UniCredit, I think it's outside-in assumptions. And I mean, we don't know any details, and it's very clear that we as Management Board, but also as Supervisory Board, our mandate is to protect the institution, to protect the interest of our stakeholders.

Bettina Orlopp: When it comes to restructuring costs and what has been said by UniCredit, I think it's outside in assumptions. We don't know any details, and it's very clear that we as management board, but also as supervisory board, our mandate is to protect the institution, to protect the interest of our stakeholders. We can't actually also do not take any directions from a controlling shareholder, but we have to follow our own strategy. That is for the time being Momentum 2030. We also have restructuring costs which we still need to book to keep that in mind. We will do that a little piece probably this year, and that's included also in our guidance, and more to come in 2027, very much dependent on where we stand then with the negotiations with the Workers' Council.

Speaker #4: So, we can't actually — we also do not take any directions from a controlling shareholder, but we have to follow our own strategy, and that is, for the time being, Momentum 2030.

Speaker #4: We also have restructuring costs, which we still need to book—so keep that in mind. We will do that in small portions, probably this year, and that's also included in our guidance.

Speaker #4: And more to come in 2027, very much dependent on where we stand then with the negotiations with the workers' council. And the rest very much depends on NHOs and the results of any talks between UniCredit and Commerzbank.

Bettina Orlopp: The rest very much depends on the talks and the results of any talks between UniCredit and Commerzbank. When it comes to the mix of cash and share buyback in our dividend policy, I assume we have been too subtle in our color coding. We have now the first tranche of the share buyback up to EUR 1.2 billion where we quickly received the ECB approval and just wait for the finance agency to follow. We will look as we have done in the past years. We will talk to our investors and then decide on the final mix. It's very clear, and we said that also beforehand, that we will increase the share of dividends because that is also the feedback that we received from investors that they want to see more dividends.

Speaker #4: And when it comes to the mix of cash and share buyback in our dividend policy, I assume we have been too subtle in our color coding.

Speaker #4: So, we have now the first tranche of the share buyback, up to €1.2 billion, where we very quickly received the ECB approval and just wait for the finance agency to follow.

Speaker #4: We will look as we have done in the past years we will talk to our investors and then decide on the final mix is very clear and we said that also beforehand that we will increase the share of dividend because that is also the feedback that we received from investors that they want to see more dividends.

Speaker #4: So, you can assume that at least 50% of the capital return will consist of dividends.

Bettina Orlopp: You can assume that at least 50% of the capital return will consist of dividends.

Speaker #3: Thank you very much.

Tarik El Mejjad: Thank you very much.

Speaker #1: Next question comes from Benjamin Goy from Deutsche Bank.

Operator: Next question comes from Benjamin Goy from Deutsche Bank.

Speaker #5: Yes, hi, good morning. You went right into income guidance, assumed to pick up and run rate about $100 million. Now, you mentioned a couple of points why this should be the case, in particular rates.

Benjamin Goy: Yes. Hi, good morning. Your return to net income guidance assumes a pick-up in run rate about EUR 100 million. You mentioned a couple of points why this should be the case in particular rates, which seems to be hopefully a given. Just wondering, where do you think are still the moving parts in terms of volume growth or deposit beta where there could be a surprise or you have actually good visibility to a much better run rate in H2 and going into 2027? Thank you.

Speaker #5: Which seems to be, hopefully, a given. Just wondering, where do you think are still the moving parts in terms of volume growth or deposit beta where there could be a surprise, or you have actually good visibility to a much better run rate in the second half and going into 2027?

Speaker #5: Thank you.

Speaker #6: Hi, Benjamin. Thanks for the question. Yeah, as you rightly say, the first half of the year actually gave us a €4.1 billion run rate of the NRI.

Carsten Schmitt: Benjamin, thanks for the question. As you rightly say, H1 actually gave us a EUR 4.1 billion run rate of the NII, therefore keeping it stable compared to the previous quarters despite lower rates. We've already seen as we expect the impact of lower rates, especially in Poland in H1. For H2, with the current Polish rates expectation being flat, we rather expect a positive impact from mBank given their volume growth that we are seeing. The biggest part in the uptick of the run rate of our NII in H2 will come from the replication portfolio which will continue to actually roll into higher rates and therefore gain more traction.

Speaker #6: Therefore, keeping it stable compared to the previous quarters despite lower rates. And we've already seen, as we expect, the impact of lower rates, especially in Poland, in the first half of the year.

Speaker #6: So for the second half of the year, with the current Polish rates expectation being flat, we rather expect a positive impact from mBank, given their volume growth that we are seeing.

Speaker #6: The biggest part in the uptick of the run rate of our NRI in the second half will come from the replication portfolio, which will continue to actually roll into higher rates, and therefore gain more traction.

Speaker #6: And then, lastly, with the beta being stable broadly in the portfolio, and volume growth expected on the deposit and loan side towards the end of the year, we expect a slight impact from that.

Carsten Schmitt: Lastly, with the beta being stable broadly in the portfolio and volume growth expected on the deposit and loan side towards end of the year, we expect a slight impact from that. Lastly, concluding with the ECB rate hike that we just saw and the landscape that we have ahead of us, that should clearly also support that stronger trajectory in H2, therefore we are confident to reach the EUR 8.6 billion in total for the full year.

Speaker #6: And then lastly, concluding with the ECB rate hike that we just saw, and the landscape that we have ahead of us, that should clearly also support that stronger trajectory in H2.

Speaker #6: And therefore, we are confident to reach €8.6 billion in total for the full year.

Speaker #5: Thank you. And maybe a second question from me. Have you seen—I mean, the numbers are ongoing, and you don't see an impact from your new large shareholder?

Benjamin Goy: Thank you. Maybe a second question, if I may. Have you seen, clearly the numbers are ongoing and you don't see an impact from your new large shareholder. Is there anything you noticed from early indicators, call it RFPs in corporate clients or wealth management, in June, July?

Speaker #5: Is there anything you noticed from early indicators—call it RFPs—in corporate clients or wealth management in June or July?

Bettina Orlopp: No, luckily not. As I said also in my speech, we're very grateful for the trust and the loyalty of our clients, which is clearly supported by the high resilience and commitment of our team members who are out there to serve our clients. Actually, rather the contrary, look on our loan growth volume, which has been 60% up. Look at our volume growth and securities volume, specifically the discretionary portfolio management, which is part of advisory, which is up 20%. We are in the lucky situation that clients value our business model, our value proposition, therefore are loyal, and we intend to keep it like that. It needs an effort if you have a lot of noise outside.

Speaker #4: No, I mean, luckily not. As I said, also in my speech, I mean, we were very grateful for the trust and the loyalty of our clients.

Speaker #4: It is clearly supported by the high resilience and commitment of our team members who are out there to serve our clients. And actually, rather the contrary, I mean, look on our loan growth volume, which has been 16% up.

Speaker #4: Looking at our volume growth and securities volume specifically, the discretionary portfolio management—which is part of Advisory—is up 20%. We are in the lucky situation that clients value our business model, our value proposition, and therefore are loyal, and we intend to keep it that way.

Speaker #4: But it is indeed an effort if you have a lot of noise outside.

Speaker #5: Thank you very much.

Benjamin Goy: Thanks very much.

Speaker #1: The question comes from Jeremy CG from BNP Paribas.

Operator: Question comes from Jeremy Sigee from BNP Paribas.

Speaker #3: You gave some quite mixed—sorry, I don't know if you can hear me. Two questions.

Jeremy Sigee: You gave some quite mixed. Sorry, I don't know if you can hear me. Two questions.

Bettina Orlopp: We can't. Jeremy?

Speaker #4: Can you Jeremy? Jeremy, can you just start again because I think you we didn't hear the beginning of your talks. Thank you.

Jeremy Sigee: Hello?

Bettina Orlopp: Jeremy, can you just start again, because we didn't hear the beginning of your talk. Thank you.

Speaker #3: Thank you. I think I started talking before I was put into the call. Two questions, please. Number one, you talked about German corporate sentiment, and you gave some slightly mixed comments.

Jeremy Sigee: Thank you. I think I started talking before I was put into the call. Two questions, please. Number one, you talked about German corporate sentiment, and you gave some slightly mixed comments. There were some positives, including new orders, but you also noted some areas of weakness in sentiment. Could you just expand on that topic a bit more from your conversations with corporate customers, particularly the Mittelstand? What are the strong points? What are the weak points? My second question on the UniCredit situation. I appreciate you need to talk to them and you need to form a joint view. Do you have any view at this stage from your point of view on what are the most promising areas among their proposals or among what they can bring in terms of cooperation?

Speaker #3: There were some positives, including new orders, but you also noted some areas of weakness in sentiment. So could you just expand on that topic a bit more from your conversations with corporate customers, particularly regarding the nickel stand?

Speaker #3: What are the strong points? What are the weak points? And then my second question, on the unit credit situation: I appreciate you need to talk to them and you need to form a joint view.

Speaker #3: Do you have any view at this stage, from your point of view, on what are the most promising areas among their proposals or among what they can bring in terms of cooperation?

Speaker #4: Okay, thank you, Jeremy. So, first on sentiment—yes, indeed, I would say it's a kind of a mixed bag, as I said. So, when you—there you can clearly see the reforms taken by the government.

Bettina Orlopp: Okay. Thank you, Jeremy. First on sentiment. Yes, indeed, I would say it's a kind of a mixed bag, as I said. When you talk to corporate clients, they clearly see the reforms taken by the government, and they appreciate that. However, they want to have more and faster. That is the story on that. If you look on the investment side, we see a lot of investments happening. The unfortunate thing so far is that still large parts of the investments take place in Europe or even abroad, maybe China or in the US. Clearly you have a lot of volatility as we speak. You have good numbers when it comes to order data. You have good numbers when you come to sentiment. On the other side, you still have the energy price situation.

Speaker #4: However, and they appreciate that. However, they want to have more and faster—that is the story on that. And if you look on the investment side, we see a lot of investments happening. The unfortunate thing, so far, is that still a large part of the investments take place in Europe or even abroad, or in the US.

Speaker #4: And then clearly, you have a lot of volatility as we speak. So, you have good numbers when it comes to order data. You have good numbers when it comes to sentiment.

Speaker #4: But then, on the other side, you still have the energy price situation. You still have the ongoing Middle East war. And now we have this new complexity—let's state it like that—which is the ongoing heat in Europe and the results of that.

Bettina Orlopp: You still have the ongoing Middle East war. Now we have this new complexity, say something like that, which is the ongoing heat in Europe, and the results of that. It's basically stable, but we expect to see more recovery in the coming quarters, specifically when we really see, hopefully, the positive results of the reforms kicking in, and the sentiment further improving and hopefully also an end of the Middle East conflict. When it comes to your second point, we will need to sit down and to talk, but we clearly will have to see whether we can join forces on specific things, on large investment programs which are not bringing us in difficulties because of the competitive situation. We will definitely need to compare products and value propositions, whether we can strengthen each other on that.

Speaker #4: So it's basically, yeah, it's stable, but we expect to see more recovery in the coming quarters, specifically when we really see the positive results of the reforms kicking in.

Speaker #4: And the sentiment further improvement and improving and hopefully also in the end of the Middle East conflict. When it comes to your second point, I mean, we will need to sit down and to talk, but we clearly will have to see whether we can we can join forces on specific things.

Speaker #4: Large investment programs are not bringing us difficulties because of the competitive situation. We will definitely need to compare products and value propositions to see whether we can strengthen each other on that.

Speaker #4: And then, clearly, at a certain point in time, we should also talk and see whether we can create any synergies by combining operations in a mid-term target picture.

Bettina Orlopp: Clearly, at a certain point in time, we should also talk and see whether we can create any synergies by combining operations in a midterm target picture. Very much the things you would expect when two banks come together, both very successful.

Speaker #4: So, very much the things you would expect when two banks come together, both very successful.

Speaker #3: That's great. Thanks very much.

Jeremy Sigee: That's great. Thanks very much.

Speaker #1: Thank you. And the next question comes from Chris Hallam from Goldman Sachs International.

Operator: Thank you. The next question comes from Chris Hallam from Goldman Sachs International.

Speaker #5: On the RWA—hi, can you hear me now?

Chris Hallam: On the RWA. Hi, can you hear me now?

Speaker #4: Oh, we can hear you, Chris.

Bettina Orlopp: We can hear you, Chris.

Speaker #5: Okay, thanks. So, just two questions on RWAs. On the RWA efficiency measures, would there be any offsetting impact from the output floors in later years?

Chris Hallam: Okay, thanks. Just two questions on RWAs. On the RWA efficiency measures, would there be any offsetting impact from the output floors in later years, i.e., would the approvals you receive take you below 72.5% of standardized, in which case you need to give some of that back as the output floors kick in? Second, you said on the RWA approval measures, they may reduce the SRTs you do this year. I guess, is there overlap on the specific RWAs, i.e., the bucket you get approval for is what you had earmarked for SRTs? Or is that just you're solving for an overall capital tailwind from RWA management? Or are lower SRTs part of sort of the quid pro quo for the ECB approval? Anything just to understand that overlap, and then if you could also comment on how you see SRT pricing today.

Speaker #5: I would the approvals you receive take you below 72 and a half percent of standardized in which case you need to give some of that back as the output floors kick in.

Speaker #5: And then second, you said on the RWA approval measures, they may reduce the SRTs you do this year. Is that— I guess, is that overlap on the specific RWAs? I.e., the bucket you get approval for is what you had earmarked for SRTs, or is that just you're solving for an overall capital tailwind from RWA management? Or is lower SRTs part of sort of the quid pro quo for the ECB approval?

Speaker #5: So, anything just to understand that overlap. And then, if you could also comment on how you see SRT pricing today. Thank you.

Chris Hallam: Thank you.

Speaker #2: Yeah, Chris, let me start with the second question. On the RWA relief that we're expecting once the model change has been approved—so, approval, as we stated, we expect during Q3.

Carsten Schmitt: Yeah, Chris, let me start with the second question on the RWA relief that we are expecting once the model change has been approved. Approval, as we stated, we expect during Q3, then we have a timeline until Q2 next year in which we gradually see these reliefs coming in. We did not have these incorporated in the original figures for Momentum 2030. You could see those coming in on top and providing tailwind and giving us optionality, quite frankly, in how we're managing RWA and generally our book. It could have an impact on SRTs, but mostly on timing in terms of us having more flexibility in when we would go for relief of RWA and hence also for capital. When it comes to SRT pricing, we actually did an SRT in Q2. We had around 2.2 billion in relief.

Speaker #2: And then we have a timeline until Q2 next year, in which we gradually see these reliefs coming in. We did not have these incorporated in the original figures for Momentum 2030.

Speaker #2: So, you could see those coming in on top and providing tailwind, and giving us optionality, quite frankly, in how we're managing RWA and, generally, our book.

Speaker #2: So it could have an impact on SRTs, but mostly on timing in terms of us having more flexibility in when we would go for relief of RWA and hence also for capital.

Speaker #2: When it comes to RWA, sorry, to SRT pricing, we actually did an SRT in Q2. We had around €2.2 billion in relief and, as we already expected when we had our conversations in the last quarter, pricing at the moment is quite favorable for this.

Carsten Schmitt: As we already expected when we had our conversations in the last quarter, pricing at the moment is quite favorable for this. We were slightly better off than the originally planned 400 basis points per RWA. We saw slightly more favorable pricing in the market. Regarding your first question on the RWA relief and the expectation in line with the output floor, that's actually a pretty good question. Apparently, the end game, if you want so for this is not yet final, especially when we're looking at the impact on unrated corporates. Generally, I think we can rather look optimistically into this, and we will revert once we have more clarity on the impacts.

Speaker #2: So we were slightly better off than the originally planned 400 basis points per RWA. So we saw slightly more favorable pricing in the market.

Speaker #2: And regarding your first question, on the RWA relief and the expectation in line with the output floor, that's actually pretty good question apparently. The end game, if you want, so for this is not yet final.

Speaker #2: Especially when we're looking at the impact on unrated corporates, generally I think we can look optimistically at this, and we will revert once we have more clarity on the impacts.

Speaker #5: Okay. Thanks very much.

Chris Hallam: Okay, thanks very much.

Speaker #1: Thank you. And the next question comes from Martin Naes from UBS.

Operator: The next question comes from Martin Ams from UBS.

Speaker #6: Yes, good morning again. Thank you for the presentation. I have two questions, please. The first one is just a follow-up on the IRB scope changes.

Martin Ams: Yes. Good morning, and thank you for the presentation. I have two questions, please. The first one is just a follow-up on the IRB scope changes. Could you clarify which areas the scope changes pertain to and what could be the approximate benefit here? Secondly, a question on deposits. We've seen some PSBC deposit decline in the Q2. You also highlighted that some fast-moving deposits, sight accounts moved to competitors. Could you comment broadly on the competitive nature in the market and what does that do to liability margins? Have you changed anything on commercial strategy and how you intend to protect your liability margins while reaching higher deposit levels or higher volumes that you, Carsten, also alluded to when talking about the NII outlook? Thank you.

Mate Nemes: Yes. Good morning, and thank you for the presentation. I have two questions, please. The first one is just a follow-up on the IRB scope changes. Could you clarify which areas the scope changes pertain to and what could be the approximate benefit here? Secondly, a question on deposits. We've seen some PSBC deposit decline in the Q2. You also highlighted that some fast-moving deposits, sight accounts moved to competitors. Could you comment broadly on the competitive nature in the market and what does that do to liability margins? Have you changed anything on commercial strategy and how you intend to protect your liability margins while reaching higher deposit levels or higher volumes that you, Carsten, also alluded to when talking about the NII outlook? Thank you.

Speaker #6: Could you clarify which areas the scope changes pertain to, and what could be the approximate benefit here? And secondly, a question on deposits—we've seen some PCBS deposit decline in the second quarter.

Speaker #6: You also highlighted that some fast-moving deposits, site accounts, move to competitors. Could you comment broadly on the competitive nature in the market and what does that do to liability margins?

Speaker #6: Have you changed anything in your commercial strategy and how you intend to protect your liability margins while reaching higher deposit levels or higher volumes, which you also alluded to when talking about the NII outlook?

Speaker #6: Thank you.

Speaker #4: I mean, the deposit competition is very high as we speak. We have new entrants on the scene with very attractive offerings, offering partly 4% and stuff like that.

Bettina Orlopp: The deposit competition is very high. As we speak we have new entrants on the scene, very attractive offerings, offering partly 4% and stuff like that. That's not profitable from our standpoint. We evaluate the situation. We also accept the fact, and that's also embedded in our planning, that we let certain deposits go because as you know it's a certain group of clients which we have specifically, the ones who are more digital native. It's also specifically for us at Comdirect, who are jumping around, to say it like that, and looking for the best interest rate offer. Therefore, it was a clear decision from our side not to participate in these offers and to compete against that and have that also in our own planning included.

Speaker #4: That's not profitable from our standpoint. So we have evaluated situation. We also accept the fact and that's also embedded in our planning that we let certain deposits go because as you know, this is a it's a certain group of clients which we have specifically the ones who are more digital native.

Speaker #4: So it's also specifically for us at Comdirect, who are jumping around, so to say, looking for the best interest rate offer. And therefore, it was a clear decision from our side not to participate in these offers and to compete against that, and have that also in our own planning included.

Speaker #4: We will, however, also go out now with certain combined products, both for Commerzbank as well as for Comdirect, to see how this runs. But it's more really a more midterm thinking of gaining clients to also stay with us, to also bring their complete banking relationship to us, than just only focused on the so-called interest rate surface.

Bettina Orlopp: We will, however, also go out now with certain combined products, both for Commerzbank as for Comdirect, see how this runs, but it's more really a more midterm thinking of gaining clients who also stay with us, who also bring their complete banking relationship to us than just only focused on the so-called interest rate surface.

Speaker #2: Yeah. And first question regarding the model changes. I mean, what's in scope is broadly the corporate book, but it's only parts of the model.

Carsten Schmitt: Yeah. To the first question regarding the model changes. What's in scope is broadly the corporate book, but it's only parts of the model, so partly addressing the book. The majority of the effect is coming from Commerzbank AG. We also expect a slight effect coming from mBank, but that's effectively the changes that we're seeing now.

Speaker #2: So, partly addressing the book, the majority of the effect is coming from Commerzbank AG. We also expect a slight effect coming from mBank. But that's effectively the changes that we're seeing now.

Speaker #4: Shall we go to the next question?

Bettina Orlopp: Can we go for the next question?

Speaker #1: Yes. The next question comes from Tobias Lukas from Kepler Cheuvreux.

Operator: Yes. The next question comes from Tobias Lukesch from Kepler Cheuvreux.

Speaker #7: Yes, good morning. Also, three questions from my side, please. First, again touching on UniCredit, the dialogue and potential timeline. Bettina, Carsten, maybe you can indicate what kind of timeline you have in mind in terms of really getting to results and communicating this.

Tobias Lukesch: Yes. Good morning also. Two, three questions from my side, please. First, again, touching on UniCredit dialogue and potential timeline. Bettina, Carsten, maybe you can indicate what kind of timeline you have in mind in terms of really getting to results and communicating this. Is that more of a year-end story which will be communicated with year-end results, or is there even a chance to get these things done earlier? In terms of capital and the payout, you mentioned the 50% plus payout ratio for dividends. If there was more to come on the buyback side, I think you hit 80% now of the expected value of around EUR 1.5 billion. Is there a chance that we get another buyback announcement already with Q3 results, or would that only be communicated with year-end results and the final take basically on the overall payout?

Speaker #7: Is that more of a kind of year-end story, which will be communicated with year-end results, or is there even a chance to get these things done earlier?

Speaker #7: In terms of capital and the payout, you mentioned the 50% plus payout ratio for dividends. If there was more to come on the buyback side, I think you’ve kind of hit 80% now of the expected value of around €1.5 billion.

Speaker #7: Is there a chance that we get another buyback announcement already with Q3 results, or would that only be communicated with year-end results and the final take, basically, on the overall payout?

Speaker #7: And very finally, on the risk result, Carsten, you mentioned that it was more bits and pieces from smaller clients, more from the service sector.

Tobias Lukesch: Very finally on the risk result, Carsten, you mentioned that it was more bits and pieces from smaller clients, more from the service sector. We are now at EUR 200 million, which is a quarter of the total you are seeing. We are used to very low risk cost numbers over the past years and quarters. Yet no impetus from any other industry which concerns you, or is there maybe one or the other bigger industry showing a little Momentum at least which could then be potentially extrapolated into the coming quarters? Thank you.

Speaker #7: I mean, we are now at €200 million, which is kind of a quarter of the total you're seeing. We are used to very low risk cost numbers over the past years and quarters.

Speaker #7: So, yet no impetus from any other industry, which concerns you? Or is there maybe one or the other bigger industry showing a little momentum at least, which could then be potentially extrapolated into the coming quarters?

Speaker #7: Thank you.

Speaker #4: Yes. So, on the timeline, I mean, it depends very much on the progress we can make. And it's also very clear, I think, that it's in the interest of both institutions to move as quickly as possible—at least also on how to deal with the current situation of the less than 50% now.

Bettina Orlopp: Yes. On timeline, it depends very much on the progress we can make. It is also very clear, I think, that it is in the interest of both institutions to move as quickly as possible, at least also on how to deal with the current situation of the less than 50% now and to get our arms around how we can create value in that. And yeah, we will see how this goes. The good thing is you will have a natural stop anyhow at Q3 results, and I am pretty sure that you all will ask both of us where we stand, you can be ensured that latest then you will get an update on where we are. When it comes to the capital with the payout. We have done in the past, we announced the second tranche with Q3.

Speaker #4: And to get our arms around how we can create value in that. And yeah, we will see how this goes. I mean, the good thing is you will have a natural stop anyhow at the Q3 results.

Speaker #4: And I'm pretty sure that you all will ask both of us where we stand. So you can be ensured that latest then you will get an update on where we are.

Speaker #4: When it comes to the capital with the payout, I mean, as we have done in the past, we did the—we announced the second tranche with Q3.

Speaker #4: At least we reported that we would file for approval with the authorities. And at the moment, we have no reason to see why we should not follow this track, which we have now done.

Bettina Orlopp: At least we reported that we would file for approval with the authorities, in the moment, we have no reason to see why we should not follow this track, which we have now done twice also this year. That is for that, on the risk result, Carsten.

Speaker #4: Twice also this year, so that's for that. And on the risk result—Carsten.

Speaker #2: Yeah. Hi, Tobias. On your question regarding the risk result—yeah, with the €202 million in Q2, actually, we have, I would call it, a regular quarter in terms of the level of risk result.

Carsten Schmitt: Yeah. Hi, Tobias. On your question regarding the risk result. Yeah, with the EUR 202 million in Q2, actually, we have a, I would call it regular quarter in terms of the level of risk result. When looking into the year, my comments in the speech earlier were more of a general nature when it comes to the small sector companies. This is where we saw inclining default rates, but we are usually not so engaged in that sector, so there was more broader-based comment on the economy in total. When we're looking into the German Mittelstand and also different segments that we are looking at, we are not seeing any outliers in the portfolio at this point in time that we could extrapolate actually into the next quarter. Take the current result and our guidance for EUR 850 million in the full year as being mindful of the current macroeconomic situation.

Speaker #2: When looking into the year, my comments in the speech earlier were more of a general nature when it comes to the small-sector companies.

Speaker #2: This is where we saw increasing default rates, but we are usually not so engaged in that sector. So there was a more broad-based comment on the economy overall.

Speaker #2: And when we're looking into the German Mittelstand and also different segments that we are looking at, we are not seeing any outliers in the portfolio at this point in time that we could extrapolate actually into the next quarter.

Speaker #2: So, take the current result and our guidance for 850 in the full year, while being mindful of the current macroeconomic situation.

Speaker #1: Very clear. Thank you. And the next question comes from Ricardo Rovera from Mediobanca.

Tobias Lukesch: Very clear. Thank you.

Operator: The next question comes from Riccardo Rovere from Mediobanca.

Speaker #5: Thanks. Thanks a lot for taking my cut to three questions, if I may. Hope you hear me well. The first one, Carsten, I just wanted to be sure I understood it correctly.

Riccardo Rovere: Thanks. Thanks a lot for taking my call. Two, three questions, if I may. Hope you hear me well. The first one, Carsten, I just wanted to be sure I understood correctly. Sorry, if you can just repeat what is the RWA saving that you expect from the new IRB models? Then just a confirmation I understood it correctly. These RWA savings are expected to be mostly on the corporate book in Commerzbank AG. Is it mostly international exposures or is also Mittelstand or anything that is not an international exposure? The other question I have is, if I understand it correctly, okay, the EUR 1.2 billion is supposed to be the first tranche of a buyback to be carried out in 2026.

Speaker #5: Sorry, if you can just repeat: What is the RWA saving that you expect from the new IRB models? And then, just a confirmation that I understood it correctly.

Speaker #5: These RWA savings are expected to be mostly on the corporate book in Commerzbank AG. And is it mostly international exposures, or is it also Mittelstand or anything that is not an international exposure?

Speaker #5: The other question I have is, if I understand it correctly, okay, the €1.2 billion is supposed to be the first tranche of a buyback to be carried out in 2026.

Riccardo Rovere: I imagine you must have done your calculations that the liquidity of the stock is enough for you to go on with this buyback and maybe a second bit in the last part of the year. Am I right in saying so?

Speaker #5: So I imagine you must have done your calculations, that the liquidity of the stock is enough for you to go on with this buyback, and maybe a second bit in the last part of the year.

Speaker #5: Am I right in saying so?

Speaker #2: Ricardo, taking your RWA question first. As to the amount, we are expecting this to be in the mid- to high-single-digit billion amount, and phasing in over the next quarters until Q2 next year.

Carsten Schmitt: Riccardo, taking your RWA question first. As to the amount, we are expecting this to be in the mid to high single-digit billion amount and phasing in over the next quarters until Q2 next year. The book that is actually affected by this is, the majority is actually AG, so there's a minor part in mBank only, but on group level, mid to high single-digit. The underlying corporates is practically a mix throughout the portfolio. So it's not limited to international or MSP. It's a mix of the models.

Speaker #2: The book that is actually affected by this, in the majority, is actually AG. So there's only a minor part in mBank, but on group level, it's mid to high single digits.

Speaker #2: And the underlying corporates are practically a mix throughout the portfolio. So it's not limited to international or MSB; it's a mix of the model.

Speaker #4: And to your second question, the answer is just yes, there is enough liquidity. And we look on the—

Bettina Orlopp: And-

Riccardo Rovere: Yeah. Thanks.

Bettina Orlopp: To your second question, the answer is just yes, there is enough liquidity. We look on that.

Riccardo Rovere: Perfect. Thanks a lot, Bettina. Thanks.

Speaker #5: Perfect. Thanks a lot, Bettina. Thanks.

Speaker #1: Very much. And the next question comes from Stefan Stallmann from Autonomous.

Operator: Very much. The next question comes from Stefan Stalmann from Autonomous.

Speaker #6: Yes, good morning. Thank you very much for taking my questions. The first one is on the benefit from the replication portfolio this year—the €600 million.

Stefan Stalmann: Yes, good morning. Thank you very much for taking my questions. The first one is on the benefit from the replication portfolio this year, the EUR 600 million. Is that roughly evenly spread between the H1 and the H2, or are there bigger differences between the two half of the year? The second question, I wanted to ask about the growth in your non-performing exposures, which has been quite steady still. I mean, +4% during the quarter, +9% year to date. There's quite a bit of growth, and maybe you can shed a bit of light on which areas of the bank are producing this non-performing exposure growth, please. Thank you.

Speaker #6: Is that roughly evenly spread between the first half and the second half, or are there bigger differences between the two halves of the year?

Speaker #6: And the second question, I wanted to ask about the growth in your non-performing exposures. Which has been quite steady still. I mean, plus 4% during the quarter, plus 9% year to date.

Speaker #6: There's quite a bit of growth. And maybe you can shed a bit of light on which areas of the bank are producing this non-performing exposure growth, please.

Speaker #6: Thank you.

Speaker #2: Stefan, let me start with the replication portfolio. There is indeed a structure in the incremental return we're seeing over the course of the year.

Carsten Schmitt: Stefan, let me start with the replication portfolio. There is indeed a structure in the incremental return we're seeing over the course of the year, in line with the rolls that we see on a continuous basis. The effect actually is increasing. For this year we will see around EUR 400 million, call it, in the H2, versus EUR 200 million that we saw in the H1. That is the structure. On the non-performing exposure, there's actually really no specific structure that we would have to this. This is broadly based in our corporate book. That's what it is. No outliers.

Speaker #2: In line with the roles that we see on a continuous basis, the effect is actually increasing. For this year, we will see around €400 million in the second half, versus €200 million that we saw in the first half.

Speaker #2: So that is the structure. And on the non-performing exposure, there's actually really no specific structure that we would have to this. This is broadly based in our corporate book.

Speaker #2: That's what it is. No outliers.

Speaker #6: Okay. Thank you very much.

Stefan Stalmann: Okay. Thank you very much.

Operator: Thank you. The next question comes from Anke Reingen from RBC.

Speaker #1: You and the next question comes from Anke Reingen from RBC.

Anke Reingen: Yeah. Hello, good morning. Thank you for taking my question. I hope you can hear me. Firstly, on the deposit competition you mentioned in Germany. I wonder, deposit beta is already 41%. You guide to 41% for the year. What are you assuming in terms of deposit volume? Or is there a risk that the deposit beta has to move higher? If you can talk about the competitive dynamic. Then, sorry, coming back on the RWA and the potential reduction. Does that mean the 183 you guided to for 2028 could be lower? Or you mentioned as well you could revisit some of the securitizations. Looking in terms of the net impact on the RWA guidance you previously provided. Thank you very much.

Speaker #7: Yeah. Hello, good morning. Thank you for taking my question. I hope you can hear me. Just firstly, on the deposit competition you mentioned in Germany—

Speaker #7: I just wonder, I mean, deposit beta is already 41%. You guys did 41% for the year. And how far are you, sort of like, does this guidance—what are you assuming in terms of deposit volume? Or is there a risk that the deposit beta has to move higher? If you can just talk about the competitive dynamic.

Speaker #7: And then, sorry, just coming back on the RWA and the potential reduction. Does that mean the €183 billion you guided to for 2028 could be lower? Or you mentioned as well, you could revisit some of the securitizations?

Speaker #7: Just looking in terms of the net impact on the RWA guidance you previously provided. Thank you very much.

Speaker #4: So on the deposit competition, we feel pretty comfortable with the deposit beta. This is also priced in the competition, as you have seen.

Bettina Orlopp: On the deposit competition, we feel pretty comfortable with the deposit beta. It's also priced in the competition as you have seen. The Q2 was highly competitive and we kept our deposit beta pretty stable. No need to adjust. We have been cautious for the years after that. Still assuming a constant increase because we believe that the competition will not go away. We keep that in mind. Overall, it's priced in.

Speaker #4: I mean, the second quarter was highly competitive, and we kept our deposit base pretty stable, so no need to adjust. I mean, we have been cautious for the years after that.

Speaker #4: We are still assuming a constant increase because we believe that the competition will not go away, so we keep that in mind. But overall, it's priced in.

Speaker #2: And on the RWA relief, a portion of the relief we will see this year, so not all of it. We will see the effect mostly in Q4, Q1, and Q2.

Carsten Schmitt: On the RWA relief, a portion of the relief we will see this year, not all of it. We will see the effect mostly in Q4, Q1, and Q2. The effect that we would see this year could mean that we are revisiting the timing of our SRT. Net-net, we are not changing the guidance for RWA for year-end at this stage.

Speaker #2: And the effect that we would see this year could mean that we are revisiting the timing of our SRTs. So, net-net, we are not changing the guidance for RWA for year-end at this stage.

Anke Reingen: Sorry, just to follow up. For 2028, you gave us 183 billion of RWAs. Should that number now be coming down?

Speaker #7: But sorry, just to follow up: For 2028, you gave us the €183 billion of RWAs. So should that number now be coming down?

Anke Reingen: Sorry, just to follow up. For 2028, you gave us 183 billion of RWAs. Should that number now be coming down?

Speaker #2: Yeah.

Carsten Schmitt: Yeah.

Speaker #7: Okay. All right. Okay. Thank you.

Anke Reingen: Okay. All right. Okay. Thank you.

Speaker #2: Yeah, yeah, yeah, yeah. Anke, you're right. For 2028, that number should be coming down since this effect was originally not in the plans for momentum.

Carsten Schmitt: Yeah. Anke, you're right. For 2028, that number should be coming down since this effect was originally not in the plans for Momentum.

Speaker #7: Okay. Thank you.

Anke Reingen: Okay. Thank you.

Speaker #1: Thank you very much. And the next question comes from Kian Abu Hussein from J.P. Morgan.

Operator: Very much. The next question comes from Kian Abouhossein from JPMorgan.

Speaker #4: Yeah, thanks for taking my question. My first question is related to a more subjective topic around your main shareholder and the discussions that you might have. I just wanted to see if you can talk about Standort Frankfurt and Munich.

Kian Abouhossein: Thanks for taking my question. First question is related to a more subjective topic around your main shareholder and the discussions that you're having, might have. I just wanted to see if you can talk about Standort Frankfurt Munich, if this is a topic for you. As well as listing, if you, in your view, think Commerzbank should be listed continuously in case of a takeout. I also wanted to see how the Mittelstand clients are behaving recently in terms of acquisition of clients as well as turnover of clients. The second question I had just on the beta, I wanted to come back. If you could just briefly discuss the exit beta on the deposits as you've done in the past, that would be helpful.

Speaker #4: If this is a topic for you, as well, and also listing if you, in your view, think Commerzbank should be listed continuously in case of a takeout.

Speaker #4: And I also wanted to see how the middle-market German clients, our current Mittelstand clients, are behaving recently in terms of acquisition of clients as well as turnover of clients.

Speaker #4: And then the second question I had, just on the beta—I wanted to come back—if you could just briefly discuss the exit beta on the deposit, as you've done in the past.

Speaker #4: That would be helpful. Okay. So with your first topic, first question, I mean, really, we will evaluate all potential design criteria when it comes to target pictures.

Bettina Orlopp: Kian. With your first topic, first question. Really, we will evaluate all potential design criteria when it comes to target pictures. I think what should always drive everything what we do is that we protect the value and that we maximize value for our shareholders. We also should keep in mind that there are other stakeholders, including staff, including clients. Therefore, I think let's start first discussions, and then we come out with some recommendations. When it comes to the behavior of our Mittelstand clients, they're very loyal, so we haven't seen clients leaving because of the situation, which is important. There are, as you know, rather conservative, meaning they are still waiting for German government to implement more reforms. We also see larger Mittelstand clients investing. They do that also together with us, but do that most of them not in Germany, but abroad.

Speaker #4: I think what should always drive everything we do is that we protect the value and that we maximize value for our shareholders. But we also should keep in mind that there are other stakeholders, including staff and clients. So, therefore, I think let's start the first discussions and then we come out with some recommendations.

Speaker #4: When it comes to the behavior of our Mittelstand clients, they're very loyal, so we haven't seen clients leaving because of the situation, which is important.

Speaker #4: There are, as you know—meaning, they are still waiting for the German government to implement more reforms. So, we also see larger Mittelstand clients investing.

Speaker #4: They do that also together with us, but do most of it not in Germany, but abroad. And they are clearly interested in, when it comes back to our strategy, what happens to our international network, because many Mittelstand clients rely on the fact that we can support them in their export business. And that is not focused only on four or five countries, but most of the time really goes across the world and includes Latin America, Africa, Asia, and other continents.

Bettina Orlopp: They are clearly interested in when it comes back to our strategy, what happens to our international network, because many Mittelstand clients rely on the fact that we can support them in their export business, that is not focused only on four, five countries, but most of the time goes really across the world and includes Latin America, Africa, Asia, and other continents. On the path of better, I hand over to Carsten.

Speaker #4: And on the positive, Bettina, I'll hand over to Carsten.

Speaker #2: Yeah. Kian, on the exit beta for Q2, we're pretty much around the average of the beta we're expecting for the full year—so call that close to 41%.

Carsten Schmitt: Yeah, Kian, on the exit beta for Q2, we're pretty much around the average of the beta we're expecting for the full year. Call that close to 41%.

Speaker #4: And if I may just add one more question, since it's at the end of the call — pension reform. You haven't really mentioned that much.

Kian Abouhossein: If I may just add one more question, since it's at the end of the call. Pension reform, you haven't really mentioned that much. Can you just discuss how that's affecting you or how you see that, how you positioned?

Speaker #4: Can you just discuss how that's affecting you, or how you see that – how you position?

Speaker #3: Yeah, yeah. I mean, we see that very positively. We also have that publicly, that we support the pension reform, and I think it's the right thing to do.

Bettina Orlopp: Yeah. We see that very positively. We also have commented on that publicly that we support the pension reform. I think it's the right thing to do. We will definitely benefit from it given the fact that we have some very clear and ambitious plans on the net commission income side. An increased demand, hopefully starting from next year on when the implementation of the pension reform starting will also support us in delivering on our plans with respect to net commission income. Overall, we are very positive. I think it's the right step. I think you can do even more as always. It's a good starting point.

Speaker #3: And we would definitely benefit from it, given the fact that we have very clear and ambitious plans on the net commission income side. So, an increased demand, hopefully starting from next year on, when the implementation of the pension reform starts, will also support us in delivering on our plans with respect to net commission income.

Speaker #3: But overall, we’re very positive. I think it’s the right step. I think you can do even more, as always, but it’s a good starting point.

Speaker #4: Thank you.

Kian Abouhossein: Thank you.

Operator: Much. The last question for today comes from Borja Ramirez from Citigroup.

Speaker #1: Thank you very much. And the last question for today comes from Boya Ramirez from Citigroup.

Speaker #5: Hello, good morning, and thank you for taking my questions. I have two follow-ups on slides 10 to 12, please. Firstly, you have reiterated that Commerzbank is open to constructive discussions with its main shareholder.

Borja Ramirez Segura: Hello, good morning, and thank you for taking my questions. I have two follow-ups on slides 10 to 12, please. Firstly, you have reiterated that Commerzbank is open to constructive discussions with its main shareholder. Could you kindly elaborate on what needs to happen before an aligned joint approach becomes feasible? In particular, how should we think about the ongoing regulatory and supervisory processes, including the BaFin investigation as having any influence on the timing of such discussions? My second question would be, on slide 12, you referred to the potential value of an aligned joint approach. I would like to ask, could you elaborate where you see the greatest areas of strategic overlap between Commerzbank plans and the view of the main shareholder? More specifically, how should we think about the role of the international business within any potential future alignment?

Speaker #5: Could you kindly elaborate on what needs to happen before an aligned joint approach becomes feasible? And in particular, how should we think about the ongoing regulatory and supervisory processes, including the BaFin investigation, as having any influence on the timing of such discussions?

Speaker #5: And then my second question would be on slide 12. You referred to the potential value of an aligned joint approach. I would like to ask, could you elaborate where you see the greatest areas of strategic overlap between Commerzbank plans and the view of the main shareholder?

Speaker #5: And more specifically, how should we think about the role of the international business within any potential future alignment?

Bettina Orlopp: Borja. The regulatory approval process is something which runs separately whenever, and this is what we learned out of the press, that there might be the completeness of the documents. Then you have a 60 working day period, where ECB has to decide. I think they can extend that to a certain amount. Then there are other approvals necessary coming from the EU, but also some other countries, and that defines the regulatory approval process. Regardless of the regulatory approval process that we can and should work with the assumption that this goes in a confirmation of the deal and the tender offer, therefore we can start dialogues as we speak. I think the only thing what we have to keep in mind, we are still competitors, number 1.

Speaker #4: Jordan, so, I mean, the regulatory approval process is something which runs separately whenever, and this is what we learned out of the press—that there might be the completeness of the documents, and you have a 60-working-day period where the ECB has to decide.

Speaker #4: I think they can extend that to a certain amount. And then there are other approvals necessary coming from the EU but also some other countries.

Speaker #4: And that defines the regulatory approval process. But regardless of the regulatory approval process, if we can and should work with the assumption that this goes in a confirmation of the deal and the tender offer, and therefore, we can start dialogues as we speak.

Speaker #4: I think the only thing that we have to keep in mind: we are still competitors—number one. And number two is, we as Commerzbank management team have the obligation to protect the interests of our stakeholders, and specifically also of our minority shareholders.

Bettina Orlopp: Number two is, we as Commerzbank management team, have the obligation to protect the interest of our stakeholders and specifically also of our minority shareholders. When keeping that in mind, we can have discussions about a joint approach. First of all, we are in a situation where we do not have any structural changes, but where we can just discuss how we deal with the situation where UniCredit has a little bit less than 50%, meaning we can align. That fits to your second question. We can align on where can we collaborate without getting into problems because we are competitors. That includes the international network, because we can clearly also provide access to that. It also includes certain product areas where we can think whether we can benefit from each other's product ranges.

Speaker #4: But when keeping that in mind, we can have discussions about a joint approach. And first of all, I mean, we are in a situation where we do not have any structural changes, but where we can just discuss how we deal with the situation where UniCredit has a little bit less than 50%. Meaning, we can align—and that fits to your second question—we can align without getting into problems because we are competitors.

Speaker #4: And that includes the international network because we can clearly also provide access to that. But it also includes certain product areas where we can think whether we can benefit from each other's product ranges and therefore I think there's a lot we can discuss and then clearly we can also discuss how a potential target picture could look like and what kind of values you could create out of that.

Bettina Orlopp: Therefore, I think there is a lot we can discuss. Clearly, we can also discuss how a potential target picture could look like and what kind of values you could create out of that. That's the task for the coming weeks and months, but we can start with it without waiting for the approvals. The BaFin investigation is anyhow something completely separate, and is something where only BaFin can speak about. Thank you very much. I wish you all a great day, a great summer, hopefully, even some summer holidays if that has not happened yet. We are also happy to take your questions afterwards. Thank you very much. Talk to you soon.

Speaker #4: That's the task for the coming weeks and months. But we can start with it without waiting for the approvals. And the baffling investigation is, anyhow, something completely separate and is something we can only buffer and speak about.

Speaker #4: So, my understanding is that—of the questions—thank you very much. And I wish you all a great day and a great summer. Hopefully even some summer holidays, if that has not happened yet.

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Q2 2026 Commerzbank AG Earnings Call

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